Phoenix Assur. Co. Allison

• Decision Date: 17 October 1894
• Citation: 27 S.W. 894
• Parties: PHOENIX ASSUR. CO. v. ALLISON et al.
• Court: Texas Court of Appeals

27 S.W. 894

PHOENIX ASSUR. CO. v. ALLISON et al.

Court of Civil Appeals of Texas.

October 17, 1894.

Appeal from district court, Williamson county; F. G. Morris, Judge.

Action by Allison, Bailey & Co. against the Phoenix Assurance Company. There was a judgment for plaintiffs, and defendant appeals. Reversed.

This suit was originally brought January 29, 1891, by S. N. Allison and 20 others, composing the old firm of Allison, Bailey & Co., against the Phoenix Assurance Company, on a policy of fire insurance issued to the firm by defendant. January 10, 1893, plaintiffs amended their original petition, omitting the name of S. N. Allison as plaintiff, and continuing the action for the remaining original plaintiffs. The policy of insurance sued on was issued by defendant to Allison, Bailey & Co. on August 25, 1890, under the following circumstances: On the 3d day of July, 1888, plaintiffs and S. N. Allison (the firm mentioned) were the owners of certain buildings and machinery, the machinery having been purchased by the firm from the Keating Implement & Machine Company, of Dallas, Texas, on a credit, owing thereon $2,900, evidenced by the firm's two promissory notes, of date July 3, 1888, each for $1,450, due, respectively, December 1, 1888, and December 1, 1889, the notes being secured by chattel mortgage of the firm on the machinery. The firm (a kind of an alliance company, not incorporated) was organized to carry on a ginnery. The buildings were erected by the firm on land a part of the homestead of S. N. Allison, he having agreed with his firm that it should have the use of the ground for 10 years. Allison was the general manager of the concern. On the ____ day of __, 1888, the firm closed out the business, selling the buildings and machinery to S. N. Allison, in consideration that he would assume and pay its debts, the notes to the Keating company being the principal part of them; the firm to have a lien upon the property to secure payment of the debt by Allison. With this transaction the firm closed business and dissolved, and Allison took possession of the property for his own benefit. At the time of the sale to Allison, it was understood that he was to have the property insured for the benefit of the firm, to indemnify it in case the property should be destroyed by fire, and he promised to do so. On August 25, 1890, Allison procured from defendant the policy sued on, insuring the property against loss by fire in the sum of $1,500, for six months, he paying the premium, — $105. The policy was issued direct to Allison, Bailey & Co., acknowledging the consideration as paid by the firm, a correct copy of which, as read in evidence, is attached to plaintiffs' amended original petition, marked "Exhibit A." At the time the policy was issued, the debts and obligations of the parties were as stated above. The application for the insurance was made by S. N. Allison, signing the name of Allison, Bailey & Co., to Black & Cannon, agents of the company, who issued the policy as such agents, it being already signed by A. D. Irving, the company's manager. The proof shows that Allison, at the time he applied for the policy, informed Cannon, the acting agent, of the facts, — of the condition of the property, and of the debts, mortgage, and lien upon it, and that he (Allison) had already insured the most of the same property for his own benefit for $1,500 in the St. Paul German Insurance Company, for the same time covered by the policy sued on November 29, 1890, the insured property was totally destroyed by fire. Within 30 days thereafter, as required by the policy, Allison, acting for plaintiffs, made and sent to defendant proof of loss, which the company declined to accept, as in conformity with the policy. Before the proof of loss was sent the defendant company sent its adjuster to the ground, and he, after investigating the loss, declined to recognize any liability on the part of the company, stating to Allison, who was acting for plaintiffs, that the company was not liable under the policy for the loss, and would not pay it. After the loss occurred, and before the suit was brought, Allison paid the debt due to the Keating Implement & Machine Company, thus satisfying the mortgage to that company and the lien held by the plaintiffs on the property against Allison to indemnify them on their liability on the Keating Company debt. Defen...